The S&P/ASX 200 index remained unchanged at 8,596 on Thursday, following a historic high in the previous session. This stability came as gains in the mining sector were counterbalanced by profit-taking in major banking stocks. The financial sector experienced a decline of over 1%, marking its weakest performance in a week. This slump was primarily driven by Commonwealth Bank of Australia, the leading bank, which fell by 2.2% to reach a two-week low. Concurrently, other significant banks such as NAB and Westpac saw their shares drop by 1.1% and 2%, respectively.
In contrast, the resource sector flourished, with key mining stocks surging over 3% to reach a three-week peak. This was fueled by increasing iron ore prices, as shipments from leading exporters Australia and Brazil decreased across all benchmarks. Notably, BHP recorded a 5.6% climb, marking its most robust session since January 2021, while Rio Tinto gained 1.8%.
From an economic standpoint, Australia's trade surplus saw a significant reduction in May, reaching its lowest point in nearly five years. Additionally, China's services PMI did not meet expectations. As a result, all eyes are now on the upcoming Reserve Bank of Australia (RBA) meeting next week, with a rate cut widely anticipated due to sluggish growth and diminishing inflationary pressures.
